BILL ANALYSIS Ó
AB 2821
Page 1
ASSEMBLY THIRD READING
AB
2821 (Chiu)
As Amended May 31, 2016
Majority vote
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Housing |6-1 |Chiu, Steinorth, |Beth Gaines |
| | |Burke, Chau, Lopez, | |
| | |Mullin | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Health |14-2 |Wood, Maienschein, |Olsen, Patterson |
| | |Bonilla, Burke, | |
| | |Campos, Chiu, Gomez, | |
| | |Roger Hernández, | |
| | |Lackey, Nazarian, | |
| | |Rodriguez, Santiago, | |
| | |Steinorth, Waldron | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |15-5 |Gonzalez, Bloom, |Bigelow, Gallagher, |
| | |Bonilla, Bonta, |Jones, Obernolte, |
| | |Calderon, Chang, |Wagner |
| | |Daly, Eggman, Eduardo | |
| | |Garcia, Roger | |
| | |Hernández, Holden, | |
AB 2821
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| | |Quirk, Santiago, | |
| | |Weber, Wood | |
| | | | |
| | | | |
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SUMMARY: Creates the Medi-Cal Housing Program to provide
support to counties who participate in the Whole Person Care
pilot program with funding for rental assistance for homeless
Medi-Cal recipients Specifically, this bill:
1)Makes legislative findings.
2)Defines "homelessness" to mean the federal definition in the
Code of Federal Regulations Title 24 Section 578.3.
3)Defines "interim housing" to mean a safe place for a
participate to live temporarily while waiting to move into a
permanent apartment affordable to the participant with rental
assistance, where the participant is not required to pay more
than 30% of his or her income toward the costs of interim
housing. Interim housing may include recuperative or respite
care and shall not be funded for longer than nine months.
4)Defines "long-term rental assistance" to mean a rental subsidy
provided to a housing provider, including a landlord renting
in the private market or developers or developer creating
affordable housing, to assist a tenant to pay the difference
between 30% of the tenant's income and the costs of operating
the assisted unit.
5)Defines "permanent housing" to mean an apartment where the
landlord does not limit stay in the apartment, the landlord
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does not restrict the movements of the tenant, and the tenant
has a lease that is subject to Civil Code Section 1940 et.al.
6)Defines "supportive housing" to mean housing with no limit on
length of stay, occupied by the target population, and that is
linked to onsite or offsite services that assist the resident
in retaining the housing, improving his or her health status,
and maximizing his or her ability to live and, when possible,
work in the community.
7)Defines the "Whole Person Care pilot program" to mean the
program included in the 1115 Medical Waiver finalized on
December 30, 2015.
8)Requires the Department of Housing and Community Development
(HCD) in coordination with the Department of Health Care
Services (DHCS) to do all of the following:
a) On or before July 1, 2017, create the Medi-Cal Housing
Program;
b) On or before July 1, 2017, draft guidelines for
stakeholder comment to fund competitive grants to eligible
counties to pay for interim and long-term rental assistance
under the Medi-Cal Housing Program;
c) On or before September 1, 2018 and every year
thereafter, subject to appropriation by the Legislature,
award grants on a competitive basis to eligible counties
and regions participating in a Whole Person Care pilot or
counties and regions with Med-Cal managed care plans
administering the Health home Program;
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d) Collect data mid-year and annually from Medi-Cal managed
care plans partnering with participating counties and
regions receiving grants awarded under the Medi-Cal Housing
Program.
e) No later than July 1, 2017, contract with an independent
evaluator to analyze data collected to determine potential
costs avoided or saved due to the Medi-Cal Housing Program.
f) By March 31, 2019, and every year thereafter, in which
the Medi-Cal Housing Program receives funding, report data
collected to the Assembly Committee on Budget, the Senate
Committee on Budget and Fiscal Review, the Assembly and
Senate committees on Health, Assembly Committee on Housing
and Community Development, and the Senate Committee on
Transportation and Housing.
1)Requires the guidelines to include a competitive scoring
criteria that includes but is not limited to scoring that
awards points based on the following:
a) Capacity to administer interim and long-term rental
assistance;
b) Identified partnerships with affordable and supportive
housing providers;
c) Partnerships with Medi-Cal managed care plans and the
percentage of county Medi-Cal beneficiaries those
partnering health plans cover;
d) Comprehensive plans that connect housing resources made
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available under the program with services made available
through the Whole Person Care pilot or the Health Home
Program; and
e) Quality of services provided through the Whole Person
Care pilot or Health Home Program in the applying county.
1)Provides that a county or a region including more than one
county will be eligible for a Medi-Cal Housing Program grant,
subject to the availability of funding, if the county or
region's lead entity meets all of the following requirements:
a) Satisfies one of the following descriptions:
i) Is either a lead entity participating in a Whole
Person Care pilot;
ii) Is a lead entity that had previously participated in
a Whole Person Care pilot that has expired; or
iii) Is a county with Medi-Cal managed care plan
participating in the health home Program
b) Has formed collaborative relationships with at least one
health plan, county health and behavioral health agency, at
least one housing authority and relevant continuums of
care.
c) Has identified a source of funding for housing
transition services and tenancy sustain services including
one or more of the following:
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i) County general funds;
ii) Whole Person Care housing pilot pool and management
care programs; or
iii) The Health Home Program
d) Agrees to contribute funding for interim and long-term
rental assistance through one or more of the following
sources:
i) County general funds;
ii) Housing pools created through the Whole Person Care
pilot; or
iii) A county or partnering housing authority set-aside
of at least 15% turn-over Housing Choice Vouchers to
residents experiencing homelessness who are eligible to
receive Whole Person Care pilot or Health Home Program
Services.
e) Has designated a process for administering grant funds
through agencies administering housing programs;
f) Agrees to collect and report data to HCD and DHCS.
1)Requires a county or region awarded grant funds to form
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agreements with partnering health plans to collect Medi-Cal
data regarding members' medical costs, to the extent such
information is available up to 12 months prior to each
participants move into permanent housing, as well as medical
costs after each participant's move in.
2)Requires a county or region awarded grant funds or the
county's or regions' partnering Medi-Cal managed care plan to
annually and at midyear intervals report the following data to
HCD and DHCS:
a) A comparison of medical costs of participants receiving
long-term rental assistance under the Whole Person Care
Housing Program to medical costs of same participants 12
months prior to move into permanent housing or, for
participants with less than 12 months of available data
prior to move into, any data available prior to move in.
b) The number of participants and the type of interventions
offered through grant funds.
1)The number of participants living in supportive housing other
housing.
2)Requires a county or region to use grants awarded through the
Medi-Cal Housing Program for one or more of the following:
a) Long-term rental assistance for period up to five years;
b) A capitalized operating reserve for up to 15 years to
pay for operating costs of an apartment or apartments
within a development receiving public funding to provide
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supportive housing to people experiencing homeless.
c) Interim housing; or
d) A county's administrative costs for up to 5% of the
total grant awarded.
1)Provides that a county resident is eligible to receive
assistance under the Medi-Cal Housing Program if he or she
meets all of the following requirements:
a) Is homeless upon initial eligibility;
b) Is a Medi-Cal beneficiary;
c) Is eligible for Supplemental Security Income;
d) Is assed likely to improve his or her health conditions
with supportive housing; and
e) Is eligible to receive services under either the Whole
Person Care pilot or the Health Home Program, whichever is
relevant to the participating county or region.
1)Provide that the Medi-Cal Housing Program is subject to an
initial unspecified appropriation after which funding for the
program will come from decreased costs of care as reported by
participating counties of moving eligible participants to
supportive housing.
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2)Requires HCD to reimburse DHCS for their costs associated with
collecting data and collaborating in the design of the
Program.
3)Allow HCD to use no more than 5% of funds from the Medi-Cal
Housing Program for purpose of administering the program.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, this bill does not make an appropriation, but
codifying the program results in cost pressure to fund the
program. A group of Assemblymembers, which includes the author,
has proposed a $650 million package of proposals for affordable
housing, including $30 million to fund the Medi-Cal Housing
Program (MCHP).
1)Assuming a one-time $30 million General Fund (GF)
appropriation for the grant program, $500,000 to HCD to
develop the grant program criteria, and $335,000 annually
ongoing for the life of the program.
2)Costs to DHCS to consult on program design are expected to be
absorbable within existing resources. To the extent it is
helpful to the program design to have more involvement from
DHCS staff in the program design, some of the one-time program
development costs could be shifted to DHCS (GF).
There is fairly convincing data that demonstrates that housing
indigent and homeless individuals who are high utilizers of
health care significantly reduces health care costs. A number
of pilot projects have been conducted that demonstrate a clear
return on investment in a fairly short period of time. To the
extent housing grants through this program reduce health care
costs of individuals enrolled in Medi-Cal, there could be
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significant savings to the Medi-Cal fee-for-service program and
a reduction in cost growth in Medi-Cal managed care. This bill
suggests any savings generated should be reinvested in the
program, by stating further funding is subject to annual
appropriations by the Legislature based on decreased costs of
care as described in 4) above. This creates ongoing cost
pressure to maintain funding but such reinvestment does not
result in additional costs.
COMMENTS:
Background: Homelessness often creates an institutional
circuit, where those experiencing it long enough cycle through
living on the streets, emergency department visits, inpatient
admissions, incarceration, and often nursing home stays. This
circuit is expensive to our public systems. Homeless
individuals cost our public systems an average of $2,897 per
month, two-thirds incurred through the health system. Half of
all homeless people have a history of incarceration. If
homeless when discharged from prison or jail, parolees and
probationers are seven times more likely to recidivate than
people who are housed. Homeless Californians incur
disproportionate Medi-Cal costs and achieve poor health
outcomes. Many experience a combination of chronic medical,
mental health, and substance abuse conditions, as well as social
determinants that negatively impact their ability to access
care.
Homeless frequent users continue to increase their inpatient
costs despite high Medi-Cal costs because they cannot obtain
sufficient rest, follow a healthy diet, store medications, or
regularly attend appointments so long as they are unhoused.
Two-thirds of frequent users have both medical and behavioral
health conditions, are homeless, and die 30 years younger than
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average.
In March 2015, the Department of Health Care Services (DHCS)
proposed using Medi-Cal to fund services and housing
assistance-supportive housing-acknowledging decades of research
demonstrating supportive housing decreases Medicaid costs among
homeless beneficiaries. The Federal Centers for Medicare &
Medicaid Services (CMS) approved use of federal Medicaid dollars
to fund services in supportive housing. Though CMS rejected
using federal Medicaid dollars to pay for housing, CMS stated
the State could use its own State dollars (through Medi-Cal or
otherwise) to fund housing subsidies. In fact, a number of
other states and jurisdictions within California, including the
State of New York and the County of Los Angeles, pay for housing
costs through health systems.
The final 1115 Medicaid Waiver in California includes the Whole
Person Care pilot program, which allows counties to tap into
federal funds to pay for care management supports, services
helping people find housing, and services promoting housing
stability DHCS is also working to implement a new Health Home
Program that would fund services for high-cost homeless
beneficiaries.
This bill would create the Medi-Cal Housing Program to provide
funding to counties that participate in the Whole Person Care
pilot program with funding for rental assistance. The program
would be funded through an initial appropriation, however, over
time the funding for the program would come from costs savings
to Medi-Cal achieved by moving homeless Medi-Cal recipients into
supportive housing.
Purpose of this bill: Supportive housing, which is affordable
housing with intensive services, allows people experiencing
significant barriers to housing stability to improve their
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health and decrease their Medicaid costs. National studies
comparing formerly homeless Medicaid beneficiaries living in
supportive housing with homeless beneficiaries receiving usual
care demonstrate Medicaid cost savings of almost $9,000 per year
after the costs of services. This bill would complete the
"Whole Person Care" nature of the 1115 pilots and the Health
Home Program by creating a program which would fund rental
subsidies tied to services dollars included in the 1115 Waiver
and the Health Home Program
Analysis Prepared by:
Lisa Engel / H. & C.D. / (916) 319-2085 FN:
0003364